The African Development Bank (AfDB) has approved 20 billion CFA francs (approximately R577 million) to support Senegal’s public finance reforms as the country works to address a growing debt crisis. The funding is intended to improve domestic revenue collection, strengthen financial transparency and advance structural reforms aimed at restoring confidence in the country’s public finances.
The announcement comes as Senegal continues to recover from the disclosure of billions of dollars in previously undeclared public debt inherited from the previous administration.
Executive Director of the Democracy Development Programme (DDP) and Senior Research Associate, Dr Paul Kariuki, said the current government has faced an extremely difficult task since taking office.
“The historical context around the situation is that there’s so much debt that was undeclared by the previous administration,” he said. “When the current administration came into power, they discovered a lot of debt that was still owing to the country, and it was in billions.”
Kariuki said the government has had to balance fulfilling its election promises while attempting to restore economic growth and stabilise the country’s finances.
“The African Development Bank has kind of thrown a lifeline,” he said, adding that greater clarity is still needed on the nature of the funding. “At the moment no one knows whether it’s a loan or it’s a grant.”
He noted that Senegal has been working to strengthen international partnerships as it seeks a path out of its fiscal challenges. However, he said concerns about financial governance have made institutions such as the International Monetary Fund and the World Bank cautious about providing further assistance.
Kariuki also pointed to ongoing challenges, including corruption in the public sector, regional insecurity and high youth unemployment, all of which continue to place pressure on the country’s economy.
He stressed that transparency would be critical to ensuring the AfDB funding delivers meaningful results.
“I hope that the African Development Bank will set some parameters on how this money will be used and the transparency needed, so that it also doesn’t find itself in people’s pockets,” Kariuki said, adding that accountability would be essential if Senegal is to rebuild confidence in its public finances and achieve sustainable economic recovery.
Listen to the full interview below:
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